Is this a fair offer in Frio County, TX

I recently received a lease offer on 16% (37.1875 acres) of 595 acres in Frio County, situated in the B. Soleto Survey No. 309, A-599. I inherited these mineral rights, and I have never been to Frio County, nor do I know anyone living there with whom I could consult. The offer was for $250 per acre/ 3 yr./ 20% royalty. The landman made the offer on behalf of VirTex Producing Company. When asked, the Landman told me that the rest of the interest had been bought out by an oil company. I do not know if this is a fair lease offer, or how to go about negotiating for more if it is low. I also don’t know if it is to my advantage or not that an oil company holds the rest of this interest on the 595 acres. I would appreciate any knowledgeable input.

I believe you found the county group, but that is always the best place to find local mineral owners

Frio County, TX Oil & Gas Group

It is too low. You may want to get in touch with a professional to help you out.

I agree with RT and Justin. You have found the correct place to get information. The proposal to you is 'out of the money' on the low side. Having an undivided interest in a large tract can be advantageous to you. It will help if you can talk to other undivided interest owners [heirs] and possibly the mineral owner that leased the buld of the property. It would also be useful to know to whom it was leased [the oil company]. You should arm yourself with these facts before you go much further. Your inherited property is a valuable asset and should be treated as such. Some leasing companies will attempt to take leases from absentee mineral owners with the plan to 'flip' them to an oil company for a profit. Sometimes a very large profit. I suggest that after you have exhausted your sources of information that you contact a professional to assit you. There are a number of folks involved with the Mineral Rights Forum that can help you.

Good luck,

Ernie Bruchez